New Officeworks boss gets growth mission

The new boss of Officeworks will have a brief to aggressively grow sales, particularly online, as its parent company Wesfarmers focuses on turning it into a dominant player in the sector like Bunnings is to hardware.

Wesfarmers announced on Wednesday that Sarah Hunter, who is currently the director of the demerger program for Coles supermarkets, would take the helm at the stationery outlet in January as managing director. Her predecessor Mark Ward is retiring from the role and will become an adviser to Wesfarmers.

Officeworks managing director Sarah Hunter.Credit:Fairfax Media

Wesfarmers had explored a sale or float of the Officeworks business last year but shelved the idea due to a tough environment for new ASX listings.

"I have been pretty clear internally that we are not looking to sell Officeworks at the moment," Wesfarmers chief executive Rob Scott told Fairfax Media on Thursday from the United States where he is on an investor roadshow promoting the Coles demerger.

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"Our focus is very much on growth and developing the business. Officworks has been performing very strongly and we still see a lot of runway ahead."

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Mr Scott said Ms Hunter had been an "important player in the turnaround at Coles" after leading its Victorian state operations and being part of the Liquor and Coles Express leadership teams.

Ms Hunter's promotion comes after the appointment of Marina Joanou as managing director of Target in August and Mr Scott said Ms Hunter's appointment was made on merit and it was also good for the business to have a woman in the role.

"We are pleased that we are building a really capable and balanced leadership team. It is important when you think the majority our customers, not just retail but commercial, customers are women, it is important that we have that balance around the leadership table," Mr Scott said.

In the last financial year, Officeworks brought in $2.1 billion in revenue to produce earnings before interest and tax of $156 million while strongly growing both. Analysts, though, predict the momentum could be about to slow with the challenge from Amazon's local operations starting to bite.

It is important when you think the majority our customers, not just retail but commercial, customers are women.

Wesfarmers chief executive Rob Scott

Mr Scott said there was plenty of potential for Officeworks to build its online offering as well as continuing to diversity its product line which has expanded recently to include arts and crafts, educational materials and children's books.

Asked if Officeworks could achieve the dominance that Wesfarmers' Bunnings chain possessed in hardware, Mr Scott said: "I think it is close to that at the moment. There are many similarities between those two businesses."

Bunnings will be Wesfarmers' biggest driver after the divestment of Coles with revenue of more than $12 billion last year and EBIT of $1.5 billion.

"Officeworks has a great reputation with a whole cross section of the market," he added noting that his children loved to shop there but declining to nominate the chain's market share.

Wesfarmers has already said it aims to open six new Officeworks stores in the near term and Mr Scott said there was capital available to drive further growth although he noted that growth in online sales was not as capital intensive as bricks and mortar retail.

Ms Hunter was unavailable for interview but in a statement said she was excited about her new job.

"It is a privilege to lead this outstanding retail brand, and I look forward to getting started in the new year,” Ms Hunter said.